Apartment owners at the Lacrosse building in Melbourne's Docklands have been awarded millions of dollars in damages following a fire in 2014 that was fuelled by combustible cladding.

The fire, ignited by a cigarette left on a balcony, led to Lacrosse’s owners seeking millions in damages during a month-long Victorian Civil and Administrative Tribunal case against the tower’s builder, LU Simon, which ended in October.

While nobody died in the blaze, the tower fire sent shockwaves through the nation’s construction industry and sparked concerns about cladding across the city.

A fire ripped up the outside of the Lacrosse apartment building in 2014.Credit:MFB

In a decision released by Judge Edward Woodward on Thursday, builders LU Simon will be ordered to pay at least $5.748m to the 211 applicants in the case.

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Further sums totalling more than $6.82 are still to be resolved and could be added to the final payment.

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However, while LU Simon will have to pay the initial sum, other respondents in the case were found to have failed to exercise reasonable care and have been ordered to reimburse the building company for almost the entire amount.

The other respondents in the case include the building surveyor and his employer Gardner Group, the architects Elenberg Fraser, and the fire engineer Thomas Nicholas.

The building surveyor's employer the Gardener Group have been ordered to pay 33 per cent of the damages, the architects 25 per cent, the fire engineer 39 per cent.

The remaining 3 per cent will be paid by LU Simon.

Judge Woodward found the builder LU Simon "breached the warranties of suitability of materials, compliance with the law and fitness for purpose" implied in its contract with the owners.

However, he said it "did not fail to exercise reasonable care" in the construction of the tower by installing the combustible aluminium composite panels - the cladding - on the facades of the tower.

The Gardner Group, which employed the building surveyor, was found to have failed to exercise "due care and skill" in issuing the building permit for the construction of the tower, and approving the cladding, which "did not comply with the building code of Australia".

Damage at the Lacrosse tower in 2014. Credit:Gregory Badrock

The architects were found to have failed to remedy defects in its design, which saw non-compliant cladding used.

The fire engineer failed to recognise that the cladding proposed for use in the Lacrosse tower did not comply with the building code and failed to warn LU Simon, Judge Woodward said.

Jeff Dawson, the chairperson of the Owners Corporation, said in a statement the residents welcomed the judgement.

"It has been a long and frustrating journey for the owners, but the Owners Corporation has maintained throughout that the owners should not bear the cost of recladding the building," he said.

"This position has now been justified. With the recladding works well under way at Lacrosse and the award of damages to be determined shortly, it is a very exciting time for the owners."

The fire was started by a resident who had left a cigarette disposed in a plastic container on a balcony. The man was also a respondent in the case, but the judge ruled the man's responsibility for loss and damage was "minimal".

Concerns over the use of cladding in Melbourne's high rise buildings have re-emerged this month following a fire that was likely fuelled by cladding at the Neo200 apartment complex on Spencer Street in the CBD.

Damage on a balcony at the Neo200 apartment block in February. Credit:Jason South

The Age understands many residents of the apartment block are talking to lawyers about what action they can take following the blaze.

About a dozen residents have been told to arrange for accommodation for up to a year while their fire-damaged apartments are repaired.

In his judgement, Judge Woodward recognised that there was widespread interest around the use of cladding and its compliance.

But he warned his judgement should "not be read as a general commentary on safety", as it was informed by the specifics of the Lacrosse case.